Commitments and Contingencies
 6 Months Ended
Sep. 30, 2019
Commitments and Contingencies Disclosure [Abstract]  
Commitments and Contingencies

NOTE 11 – COMMITMENTS AND CONTINGENCIES

 

Facilities Leases

 

In January 2015, the Company entered into lease agreements for the lease of two buildings totaling approximately 76,000 square feet under non-cancellable operating leases (the “Leases”). The Leases were on a triple net basis and required aggregate monthly payments of approximately $45,000 with annual rent escalations as negotiated. The Leases covered the period from February 2015 through January 2018. In September 2017, the Company entered into amendments to the Leases to renew the lease terms for the period from February 1, 2018, through January 31, 2028 (the “New Leases”). The New Leases require monthly payments beginning at approximately $57,000 with annual rent escalations at a negotiated rate plus the usual additional triple net costs. The Company has also entered into a sublease agreement that requires monthly payments of $17,700 from the sub-lessee on a month-to-month basis which terminated in November 2018.

 

Since our leases do not provide an implicit rate of return, we used our incremental borrowing rate of 10% based on the information available at adoption date in determining the present value of lease payments.

  

The following table sets forth the recorded assets and liabilities related to the Company’s operating leases:

 

    Balances at
March 31, 2019		     Adjustments
from Adoption
of New Lease
Standard		     Balances at
April 1, 2019		  
Assets                        
Right-of-use assets     -       4,059,492       4,059,492  
Liabilities                        
Deferred rent liability     263,955       (263,955 )     -  
Operating lease liability – current     -       246,473       246,473  
Operating lease liability – non-current     -       3,813,019       3,813,019  
Stockholders’ Equity (Deficit)                        
Accumulated deficit   $ (36,489,917 )     263,955     $ (36,225,962 )

 

    September 30, 2019     March 31, 2019  
Right-of-use asset   $ 4,001,449     $ -  
                 
Deferred rent liability – current   $ -     $ 263,955  
Operating lease liabilities     246,473     $ -  
Operating lease liabilities – non-current     3,755,622       -  
Lease liabilities – total   $ 4,002,095     $ 263,955  

 

The contractual future maturities of the Company’s operating lease liabilities are as follows:

 

Fiscal Year   Lease
Commitment		  
2020   $ 428,153  
2021     655,910  
2022     675,587  
2023     695,855  
2024     716,731  
Thereafter     2,943,233  
Total lease payments     6,115,469  
Less: Future interest expense     2,113,374  
Total   $ 4,002,095  

  

Litigation

 

The Company is involved in certain legal proceedings that arise from time to time in the ordinary course of its business. The Company is currently a party to several legal proceedings related to claims for payment that are currently accrued for in its condensed consolidated financial statements as other current liabilities or accounts payable. The Company records accruals for contingencies to the extent that management concludes that the occurrence is probable and that the related amount of loss can be reasonably estimated. Legal expenses associated with the contingency are expensed as incurred. The Company is not currently involved in any legal proceedings that could potentially have a material impact on its statement of operations.